News

Toronto’s Rent Prices for Smaller Units Take a Sizable Fall

It's getting cheaper to rent what are called "shoe-sized condos" in downtown Toronto.

Here's an excerpt from a March 2 Narcity article:

City living in 400 square feet is going out of style fast, according to a new report on Toronto's rent prices by Rentals.ca.

The report indicates that the average rent for smaller units in the city is down almost 23% year over year and it's believed that prices will drop even more from here.

The March 1 report says that the average cost of these units is now $1,691. With prolonged closures and the shift to remote work, downsized living for the sake of proximity to the city is no longer as desirable.

"The smallest units in the market, ranging from 400 square feet to 600 square feet have really seen rents decline during the pandemic," said President of Bullpen Research & Consulting Ben Myers in the report.

"With the second COVID lockdown still underway, a return to downtown offices is still likely a ways off, and the downward trend is expected to continue."

This shift has led to properties going on the market for much less than pre-pandemic prices.

You can find downtown bachelors with upgraded features for less than $1,300 a month, and some even come with pool and sauna access. Studio condos in Toronto's luxury hotels are also selling for as little as $370,000.

On the same note, Elliott Wave International's February Global Market Perspective discussed challenges faced by British landlords. Here's a chart and commentary:

ForRenters

In January, property researcher Molior London reported the lowest number of central-London construction starts in more than a decade. Sales of newly built homes came in at 4,190 in the fourth quarter, down 27% from a year earlier, which is the slowest pace since 2011. At current rates, Molior estimates that it would take nearly three years to clear the capital's unsold homes. But current sales rates are actually likely to worsen. Just ask British landlords, who have been facing two of the real estate market's most costly trends in tandem: rising vacancies and falling rents. According to this chart, prime central-London rentals sat empty for an average of nearly 80 days in fourth quarter of 2020, up from around 50 days a year ago.

The metric rose each quarter in 2020 and pushed to its highest level since the 2008-09 financial crisis. The weakness, meanwhile, comes despite property owners' red-carpet treatment of prospective tenants. According to property data company LonRes, new renters today get nearly triple the discounts they received before the pandemic, and more than half of tenants have managed to negotiate reduced rents. In December, owners slashed average luxury rents across London by more than 14%, the biggest annual slide since the financial crisis.